What Is Gross National Product?

Gross National Product, or GNP, is a number that represents the total market value of the output of a nation’s good and services annually.The GNP is generally held to be the best indicator of a country’s economic health.

To consider GNP as an equation, here’s how it adds up:

GNP = C + I + G + NE

C = consumption expenditures
Personal consumption expenditures on consumer goods and services.

I = investment expenditures
Gross private domestic spending by business firms on future productivity, including changes to inventory.

G = government expenditures
Federal, state, and local governmental spending on finished goods and resources.

NE = net exports, or total exports minus total imports
The amount of goods and services that are exported less the amount of goods and services imported.